After only a couple of years competing in US market, Dell has decided to discontinue smartphone sales. The computer giant began offering the touch-screen Aero smartphone in the later part of August 2010. The device was designed around Google’s Android operating system.
No official word has been issued on their decision to stop offering smartphones in the US market, but a recent interview with Amit Midha, president of Dell’s Asia-Pacific and Japan business, reveals that Dell has no intention of getting out of the manufacturing of the devices.
“….But that doesn’t mean it is a PC versus smartphone versus tablet situation. Think about the different types of screens driving different behaviours to access and create information. So we are not saying that we are a PC company so that’s what we will do. We are so much more than a PC company. And we are absolutely focused on the smartphone and tablet as well. We are also seeing that netbook and tablet sales are offsetting each other. Also, people are carrying an additional device with the notebook—the tablet —but are not replacing it yet.”
Though Dell has asserted its focus on developments in all these areas, obviously it doesn’t mean they are a relevant competitor in every market. The success of iPhone, BlackBerry, and many Samsung and Motorola products in the US make for some pretty stiff competition. Perhaps their focus in the US should be different, which it seems is the case.
Midha expresses this sentiment:
“Today, half of our profitability comes from the enterprise and services side. Even though end-user solutions is half of our revenue we have more than half of our profitability coming from enterprise. As time progresses, more and more of our growth and profitability will come from non-end-user side. Even in that segment, our focus will be more on premium products.”
“…PCs are still growing, though at a slower rate than in the past. But the headlines are a little bit more sensational then we think the reality is. Because our customers tell us that some of the smartphone, tablet products they have used don’t work with printers well, there are security problems, privacy problems with them. But this is a good starting point. But how do you take the best out of that and bring into the corporate scenario.”
“We support the cloud platform, it is the best software and services opportunity for us, but we don’t think the current context of the tablet is ready for a corporate setting. We have made some of the announcements about a Windows 8 tablet. It connects with everything that the corporates have, it has privacy policies and gives IT (information technology) managers complete control.”
So we have some indications that Dell will be focusing more on the Enterprise end of their business, but still continuing to address the end-user side of the PC market. I am sure their tablet offerings will have more of an impact on the US market than their smartphones did.
Perhaps enterprise will slowly take over more of their business in 2012, but for now, we can expect Dell to continue to compete in the consumer side of things. I am curious if their are any Dell smartphone fans out there who are disappointed in the decision to withdraw from the US market.